MRV BLOG: MRV Market Commentary December 18, 2025

Check-in here to see the MRV commentary on what we have seen and are seeing in the dairy market.  These insights have been developed from MRV’s proprietary data, industry experience, and industry reports referenced below. Here’s our latest:

U.S. milk production continued to rise, driving higher output from dairy processors. Butter production surged over 10% year-over-year, supported by abundant fat supplies. Cheese output increased 3.2%, led by Italian varieties, which helped push exports to record highs. This also generated more whey for higher-value products like whey protein isolates and concentrates, while lower-protein WPCs declined. Meanwhile, milk powder production fell 4.1% due to weaker global demand and a shift to routing skim solids into other dairy products, even as nonfat dry milk stocks remained elevated.

WHAT MRV SEES
MRV still sees the downward pressure on dairy prices for January 2026 as largely driven by oversupply of milk, both domestically and globally. In the United States, milk production is projected to increase with USDA forecasts indicating upward revisions for 2025 and 2026 output, pushing total U.S. production toward 231.3 billion pounds. Globally, major exporters are adding to this supply surge, exacerbating the imbalance as production growth continues to outpace demand. U.S. exports face stiff competition and seasonal softness as consumer preferences change and import appetite has been reduced which limits outlets for excess milk. Major dairy products such as cheese and butter are experiencing inventory buildup and declining spot prices, pulling down Class III and Class IV milk values. This current glut scenario is likely to keep prices suppressed through the first quarter of 2026.

This information cited by MRV Marketing, LLC is for informational and reference purposes only. It is not intended to be a conclusive statement of future market conditions. It is not legal advice or legal documents. The data used in these documents contains references to information created and maintained by other organizations or agencies. Please note that MRV Marketing, LLC does not control and cannot guarantee the accuracy of these outside materials.

Statistical data referenced here is gleaned from reports by MRV Proprietary Data, CME Group, Dairy Herd Management, USDEC and USDA.